Wells Fargo sees significant slowdown in account openings

Published 3:02 pm, Thursday, November 17, 2016

Wells Fargo has been under fire over employees opening accounts without customer authorization.

Wells Fargo has been under fire over employees opening accounts without customer authorization.

Photo: FREDERIC J BROWN, AFP/Getty Images

Wells Fargo sees significant slowdown in account openings

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Wells Fargo disclosed signs Thursday that its customers are significantly pulling back from doing business with the bank, a reverberation of the sales practices scandal that drew a huge fine in September.

After details of the practices came to light, Wells has disclosed monthly customer traffic figures at its branches, something a bank typically would never share. The goal was to provide the public, and more importantly investors, a look into how Wells was being affected by the scandal.

Wells began by sharing information about September, but that data included only part of the impact of the scandal because a huge fine by regulators and the ensuing outrage occurred mid-month. So the October data is the first full-picture view of customer reaction.

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It is not pretty. New customer account openings fell 44 percent in October from a year earlier, while account closures rose 3 percent from the previous year. The bank saw a 50 percent drop in credit card applications. Wells’ own customer service metrics also plunged, with “customer loyalty” scores dropping to 52.3 percent, down more than 10 percent from a year earlier and from August, the month right before the settlement was announced.

The San Francisco bank has been under fire since it was discovered that in order to meet lofty sales goals, employees opened up to 2 million bank and credit card accounts without customer authorization.